The problem is that RelativeSource does not work in the following case. I use silverlight 5.
//From MainPage.xaml
<Grid x:Name="LayoutRoot" Background="White" Height="100" Width="200">
    <Popup IsOpen="True">
        <TextBlock Text="{Binding Path=DataContext, RelativeSource={RelativeSource AncestorType=Grid}}" />
    </Popup>
</Grid>
//From MainPage.xaml.cs
public MainPage()
{
    InitializeComponent();
    DataContext = "ololo";
}
If I set a breakpoint on the binding, I'll get Error:
System.Exception: BindingExpression_CannotFindAncestor.
If I use ElementName=LayoutRoot instead of RelativeSource, everything will be OK.
Why does the relative source binding not work?
Popup is like ContextMenu , ToolTip controls , They are not added to the VisualTree. For this you will have to do like
<Grid x:Name="LayoutRoot" Height="100" Width="200" Background="Black">
    <Popup Grid.Row="0"  x:Name="popup" DataContext="{Binding PlacementTarget.DataContext, RelativeSource={RelativeSource Mode=Self}}">
        <TextBlock Text="{Binding DataContext, ElementName=popup}" Background="Red" Width="30" Height="30" />
    </Popup>
</Grid>
public MainWindow()
    {
        InitializeComponent();
        DataContext = "abcd";
        popup.PlacementTarget = LayoutRoot; 
    }
I hope this will help.Not like in case of ContextMenu or Tooltip , here you will also have to specify the PlacementTarget.
You can make small hack: setup DataContext via resources.
<Grid.Resources>
    <Style TargetType="TextBlock">
        <Setter Property="DataContext" Value="{Binding ElementName=myGrid, Path=DataContext}" />
    </Style>
</Grid.Resources>
As others have mentioned, it's because the Popup is not part of the visual tree. Instead, you can use the Popup's PlacementTarget property to get back to the visual tree:
<Grid x:Name="LayoutRoot" Background="White" Height="100" Width="200">
    <Popup IsOpen="True">
        <TextBlock Text="{Binding RelativeSource={RelativeSource Mode=FindAncestor, AncestorType={x:Type Popup}}, 
                                  Path=PlacementTarget.DataContext}" />
    </Popup>
</Grid>
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